The Hedge Fund That Beat Paulson and Soros

BusinessWeek – Hedge fund managers are measured by two things: the size of their fund, and how much they earn for investors. Since 2009, Ray Dalio’s Bridgewater Associates has been the biggest hedge fund. According to a Feb. 29 report by Leveraged Capital Holdings (LCH), a British fund of funds, Dalio has now earned more money for clients than any other fund manager, ever.

Bridgewater’s Pure Alpha fund, which Dalio launched in 1975, made $13.8 billion in 2011, bringing its total lifetime gains to $35.8 billion. That vaults Dalio over George Soros and John Paulson for career fund earnings. Soros is the billionaire investor legendary for making $1 billion in a single day in 1992 by shorting the pound—giving him a colorful reputation for “breaking the Bank of England.”When he retired last summer, that froze his Quantum Endowment Fund’s total lifetime net gains at $31.2 billion since its launch in 1973.

John Paulson, after making billions over the past few years by shorting subprime mortgages, got crushed in 2011, losing $9.6 billion, according to Bloomberg News.That’s double Long-Term Capital Management’s epic loss of nearly $4.8 billion in 1998. Since he launched his fund in 1994, Paulson has net gains of $22.6 billion.